Airbnb renting and the law – the good, the bad and the ugly

Airbnb is an international phenomenon which is bringing changes to cities across the world. To some people it is wonderful. To others it is evil. But what is it really?

In this series, I have been concentrating on the (English /Welsh) legal obligations that Airbnb hosts have to comply with to stay within the law.

However today, in this final post, I want to look more at the wider effects and how we in England and Wales can deal with it. Starting with

Airbnb – The Good

There is no doubt that Airbnb has changed the lives of many people. If you live in a city which other people might want to visit and have a spare room – you have a new income stream.

This could mean that

You can pay for that training course and get a better job

You can pay for a computer for your child to help her at school

Or maybe you can afford to eat AND pay the rent

Provided you comply with all the legal rules I outlined in the fourth post in this series, and are not breaching any of the prohibitions set out in the second post – there is no reason why you can’t do this.

At a time when rents have never been so high or sucked up such a large proportion of people’s income – renting on Airbnb can be a genuine life changer.

People who criticise Airbnb must not forget this.

Airbnb – The Bad

However, the Airbnb phenomenon does bring problems in its wake. One big problem is that affordable places to live for local people are increasingly in short supply.

People who might formerly have rented out a room to a lodger are now hosting holiday accommodation for foreigners and landlords who previously rented to local people are now renting their properties as holiday homes.

We already have a housing crisis in this country. The Airbnb phenomenon is making it worse.

This problem doesn’t only affect the UK, and cities across the world (for example in Berlin) are bringing in legislation to limit Airbnb type short lets.

There can also be problems for neighbours of properties being let to rowdy holiday makers on Airbnb and also security issues where security is being compromised for example by door entry codes in blocks of private flats being given out to short term holiday makers.

Then there is the problem with social housing renters letting to Airbnb guests. These will usually be in breach of the terms of the hosts’ tenancy agreement – but the trouble is that these breaches are not being enforced. Meaning that properties meant to house families (and which are desperately needed) are being used as cash cows by social housing tenants.

The Ugly

Probably the ugliest aspect of Airbnb renting is discrimination – in particular when hosts refuse to accept guests because they are black. For example, as reported here:

In July 2015, the hashtag #AirBnbwhileblack was created after Airbnb user Quirtina Crittendon found herself continuously declined as a guest when she tried to rent properties. She says it was only when she shortened her first name to Tina and swapped her profile picture with a generic cityscape image that the rejections stopped.

To do them justice, Airbnb are trying to overcome this as described in this article but with millions of listings there is a limit to what they can do.

There is also the problem of bookings on the site (eg in Berlin) which cannot be fulfilled as described by this Guardian reader.

What are the answers?

I think we all have to accept that the Airbnb phenomenon is here to stay. Personally, I don’t think we can or (provided they comply with the rules) should limit people renting out a room (or sofa) in their own home to Airbnb guests.

The transformation which the extra money brings to the lives of many of the hosts, the friendships that can develop with overseas guests, plus the extra money coming into the local economy are all good things.

The main problems seem to me to be with renting out whole properties. These do drive up rents and mean that properties which previously might have been used for local people are now used for holiday makers.

However, again so long as people comply with the rules, there is not a lot that local or national government can do about it. Although, one of the biggest problems is that many people are NOT complying with the rules and no-one is doing anything about it. There needs to be more enforcement.

The Airbnb phenomenon reducing housing for local people is also one of the problems which comes from relying on the private sector to house local people. Private landlords are naturally concerned to make a profit on their investment. Most private landlords are decent people providing a decent service. However, it is unreasonable to expect them to voluntarily take a drop in income for the social good.

If National and Local Government want to control the supply of housing for local people there are two main methods at their disposal.

The first is planning. This can be effective and many cities such as Berlin are enacting new planning laws to control short holiday lets in residential properties.

The second is social housing. If we need low-cost housing to house local people and essential workers, the best people to provide this are Local Authorities and dedicated Housing Associations. So social housing supply should be stepped up – and not sold off.

Only where government own or control properties can they determine who lives in there – always assuming that they are able and willing to enforce prohibitions on subletting.

There is also the option to work with Airbnb as is being done in Amsterdam. Although the problem here is that Airbnb cannot release details of hosts who fail to comply with the rules due to data protection.

Solutions will need to be found however to the problems brought by the Airbnb phenomenon, as Airbnb and sites like it are not going to go away.

IMPORTANT: Please check the date of the post above - remember, if it is an old post, the law may have changed since it was written.

You should always get independent legal advice before taking any action.

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Comments

Another angle on this Tessa is rogue agents using holiday short let scams to deny true security of tenure to people who are in fact tenants.

I have one such case right now where the agents are listed on AirBnb as suppliers but who are creating pretence agreements to people from abroad who are renting with no idea of the legal system in the UK who presume from their 12 pages letting agreements that they are licensees and are not entitled to a possession order.

The lettings are kept to 12 weeks to sidestep planning laws on change of use but are later renewed.

The genius of this scam, if I can call it that, is that people from abroad renting rooms in a property will generally be single and often have no recourse to public funds, so when things got awry they cant get assistance from the local authority and the local authority, responsible for policing the PRS will only get to know about the letting if someone complains.

Do you see the unbroken circle here? A vacuum sealed scam that only comes to light occasionally and by serendipity

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